Kenneth Lobell v. Capital Transport, LLC

Court of Appeals of Texas·Decided December 15, 2015·No. 03-13-00855-CV·Published

Opinion

TEXAS COURT OF APPEALS, THIRD DISTRICT, AT AUSTIN

NO. 03-13-00855-CV

Kenneth Lobell, Appellant

v.

Capital Transport, LLC, Appellee1

FROM THE DISTRICT COURT OF BELL COUNTY, 146TH JUDICIAL DISTRICT NO. 257,590, HONORABLE JACK WELDON JONES, JUDGE PRESIDING

MEMORANDUM OPINION

In this interlocutory appeal, Kenneth Lobell, a Louisiana resident, appeals the trial

court’s order overruling his special appearance challenging the trial court’s personal jurisdiction over

him. See Tex. Civ. Prac. & Rem. Code § 51.014(a)(7); Tex. R. Civ. P. 120a. Capital Transport,

LLC; Capital Oil Field Services, LLC; and Chad Denton sued Lobell, three companies owned by

Lobell (the Lobell Companies), and three other individual defendants in Bell County. Lobell and

the Lobell Companies filed a joint special appearance.2 The trial court sustained the special

appearance as to the Lobell Companies and overruled it as to Lobell. For the reasons that follow,

we affirm the trial court’s order.

1 Capital Transport, LLC; Capital Oil Field Services, LLC; and Chad Denton are plaintiffs in the proceeding below. Lobell’s notice of appeal did not list all of the plaintiffs/appellees individually. We refer to appellees as Capital Transport. 2 The other defendants also filed special appearances that are not before us in this appeal. FACTUAL AND PROCEDURAL BACKGROUND3

Denton and Randy Baker, both Texas residents, had worked with Buster Stabinski

and Chad Hansen for a number of years on construction and disaster relief projects through several

companies they formed or owned. One of those companies was Capital Transport, LLC, a Louisiana

limited liability company located in Round Rock, Texas, in which Denton is the sole member. In

the spring of 2011, the men formed the idea to develop and build a “man camp” to provide

temporary residences, logistics, and transportation services to workers in the newly developing oil

fields in North Dakota. It appears from the record that this new venture was to be undertaken

through Capital Transport, LLC, and through new companies to be formed—although the individuals

dispute whether a partnership was formed between them.4 They agreed to use the name

Capital Riggers Lodge as the name of the company housing the oil field workers. Through

Capital Transport, LLC, and Capital Riggers Lodge, preliminary steps were taken, including securing

water rights, applying for a conditional use permit, entering into a uniform offer to purchase land,

entering into master agreements with various oil field companies, drafting marketing and

informational booklets to provide to prospective investors, and developing a logo.

In the summer of 2011, the four men decided to change the name of the man camp

housing the workers to Capital Lodge and form a Texas limited liability company, Capital Lodging,

to build it; however, upon learning from the Texas Secretary of State that the name Capital Lodging

3 The factual and procedural background is taken from the record. Much of the factual background is disputed. 4 The record reflects that Denton and Hansen believed a partnership existed but that Baker and Stabinski did not believe a partnership was formed.

2 was already taken, Denton formed Capital Oil Field Services, which Capital Transport alleges was

to serve as “the primary name of the partnerships to be formed by the partners.”5 Having determined

that they needed additional funding, they decided to defer formation of Capital Lodging, LLC, until

they found an investor.

Either Baker or Stabinski located Lobell as a potential investor, and in July 2011,

Stabinski informed Denton that Lobell had resources and funding to contribute. Baker and Stabinski

met with Lobell in Louisiana to discuss the project, and over the next few months, the five men

discussed the project by telephone conversations, text messages, and emails. It was decided that

Lobell would form Capital Lodging, LLC, and be its sole member. According to Capital Transport,

Lobell agreed to enter into an operating agreement with the others, providing that 65% of the rents

and deposits would go to Lobell and 35% would go to the others until Lobell’s investment was

recouped, at which time each would receive 20% of the profits. Capital Transport also alleges that

in late July 2011, while Denton was in Texas and Lobell was in Louisiana, Denton and Lobell agreed

by telephone to operate the trucking aspect of the project through Capital Transport and use a new

bank account at Chase Bank in Round Rock. Around the same time, Lobell bought an 80-acre tract

of land in North Dakota proposed as the site for the man camp in his own name and registered

Capital Lodging, LLC, with the secretary of state in Louisiana.

5 Capital Transport alleges that the marketing materials show the name and logo “Capital” with the full name “Capital Oil Field Services LLC.” Capital Transport also alleges that “Capital Transport, LLC’s operation would generate operating cash, development costs and a source of capital development” and that “[s]ubsequent projects were to be placed within the ‘family’ of partnerships operated by Capital Oil Field Services, LLC.”

3 Capital Transport alleges that around this same time, Baker told Denton that the

highest priority was to get the project up and running and that the operating agreement would be put

in place when Lobell drafted it. Through Capital Transport, LLC, and Capital Oil Field Services,

Denton prepared applications for insurance, contractor licenses, and other documents, proceeding

under the impression that the five men had formed a partnership. Capital Transport further alleges

that during this time period, Baker and Hansen told Denton they needed to concentrate on the man

camp and defer work on Capital Transport, LLC’s business of trucking and oil rig transportation.

In August, Denton became concerned about the status of the operating agreement and traveled to

North Dakota. He observed numerous trucks and equipment trailers bearing the name “Capital” and

“Capital Oil Field Services” on the sides and employees wearing baseball caps, shirts, and jackets

with the name “Capital Oil Field Services.” Concerned that the others had not been candid with him

about concentrating on the man camp and deferring work on Capital Transport, LLC’s trucking

business in North Dakota, he drafted an operating agreement and presented it to Baker, Stabinski,

and Hansen. Within a day or two, Baker told Denton that Lobell did not want Denton to be involved

in any projects going forward. Denton then traveled to Louisiana to meet with Lobell. At the

meeting, Lobell informed Denton that he had never intended to enter into a partnership agreement

whereby he provided most of the funding but received only 20% of the profits. After that meeting,

Baker, Stabinski, and Hansen ceased communicating with Denton and refused to provide him any

information about Capital Lodging or the other business entities.

Capital Transport filed this suit in Bell County, Texas, in June 2012, alleging breach

of partnership agreement and a variety of tort claims. After being served by substituted service

4 several months later, Lobell and the Lobell Companies filed a verified special appearance under

Rule 120a of the Texas Rules of Civil Procedure, asserting that the trial court lacked personal

jurisdiction over them. See Tex. R. Civ. P.

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